After paying off $40,000 in student loans with his wife, Bobby Hoyt quit his job as a teacher three years ago to focus on his personal finance blog, Millennial Money Man, and online entrepreneurship venture, Laptop Empires, full-time. Now, things are truly starting to take off.
In January alone, the 29-year-old’s income topped $155,000, mostly thanks to launching successful online courses on business and social media. In March, he pulled in another $132,000.
Despite his success, Hoyt still drives a 14-year-old GMC Yukon XL that has 137,000 miles on it. And he’s not driving an old car to make a point. “I’m not some kind of masochist that just enjoys having a crappy car,” he writes on Millennial Money Man. “I’m also not keeping this car just to prove that I’m ultra frugal or something.”
Rather, the simplest reason he chooses to stick with his older model is because it he doesn’t care about what kind of car he drives as long as it works. “I’m not embarrassed to drive an old car, and I certainly don’t care if anyone thinks I ‘should’ be driving a newer one,” he writes.
He also knows that owning a fancy vehicle isn’t an investment. “The other reason I don’t have a newer car? Depreciation,” he says. “They just lose value so fast, and it doesn’t make a lot of sense to me to throw my money away voluntarily on something that doesn’t bring me any additional joy.”
Financial expert Suze Orman agrees. She says that “a car is a lousy investment” that “only loses value.” While owning a vehicle is non-negotiable for many people, the vehicle itself doesn’t need to be flashy or expensive to get the job done.
Orman recommends thinking of a car as a utility. “One of the best ways to build financial security is to spend the least amount possible on a car that meets your needs,” she says. “Forget about the bells and whistles you want. Paying less helps you pay off the car faster.”
For Hoyt, upgrading to a newer car just for the sake of owning something nicer or cooler isn’t going to enrich his life. He’d rather spend his disposable income on things that make him happier, like going on vacation, and only put money into a car when it becomes a safety issue.
Hoyt and his wife did recently splurge on a 2015 Mercedes for her after the Jeep she’d owned since high school had two major breakdowns and became unreliable. But his views on car buying hasn’t changed: The Mercedes isn’t an investment, it’s a way to treat his wife.
“Since she gave me the okay to quit my teaching job to run M$M three years ago, I promised I would make the sacrifice worth it for her eventually,” he tells CNBC Make It.
Hoyt himself is still sticking with the 2004 Yukon — and he doesn’t envision that changing anytime soon.
